Taking action against fraud and strengthening financial and procurement management
GATINEAU, QC, March 20, 2024 /CNW/ - The Government of Canada is committed to spending Canadians' tax dollars wisely and responsibly. This includes a commitment to doing businesses with suppliers that meet the expectations of Canadians, and ensuring that the government's procurement processes are effective and well-managed.
There have been serious questions raised regarding the integrity of the federal procurement system, including the practices of certain suppliers to the Government of Canada. As the Auditor General of Canada and the Procurement Ombud confirmed in their recent reports, there are clear rules in place to ensure sound procurement management practices across government, but more can be done, including with the rules governing the conduct of suppliers to the government.
Today, the Honourable Jean-Yves Duclos, Minister of Public Services and Procurement, and the Honourable Anita Anand, President of the Treasury Board, announced a number of measures the Government of Canada is implementing to strengthen and streamline oversight of federal government management practices, particularly in the area of procurement.
The Government of Canada is taking action to strengthen the integrity of the procurement process and to help ensure that Canada does not contract with suppliers of concern. This work builds on modernizing government procurement practices so that they are simpler and less administratively burdensome, deploy modern comptrollership, encourage greater competition and include practices that support our economic policy goals, including innovation, and green and social procurement.
As part of this modernization, Public Services and Procurement Canada (PSPC) has been using advanced data analytics that have uncovered a number of instances of suppliers fraudulently billing the Government of Canada. These efforts, along with recent reports by the Auditor General of Canada and the Procurement Ombud, as well as parliamentary committee studies, have revealed a need for action on many fronts to improve the management and integrity of Canada's procurement processes.
PSPC is moving forward to further strengthen oversight of federal procurement processes with the launch of the new Office of Supplier Integrity and Compliance (OSIC) program. The new Office will enhance PSPC's capacity to identify and respond to instances of supplier misconduct.
The establishment of OSIC will provide an opportunity to modernize the Government of Canada's debarment and suspension program and further strengthen its approach to the use of data analytics to identify potential instances of fraud and wrongdoing within federal procurement. This includes ensuring the Government of Canada has the tools to address other concerning conduct, such as empowering the government to debar suppliers convicted of offences like terrorist financing, the use of human trafficking or forced labour, or similar offences recognized in provincial and foreign civil judgments.
The launch of OSIC builds on other recent activities undertaken by PSPC to make immediate improvements to procurement processes and procedures, beginning with professional services contracting, and increasing transparency surrounding contract information. Additionally, PSPC has started using advanced data analytics to ensure the soundness of the procurement system. These activities have proactively uncovered a number of instances of suppliers fraudulently billing the Government of Canada. In response, PSPC has referred these cases to the Royal Canadian Mounted Police and will be working with suppliers and impacted departments to recover fraudulently billed funds.
Furthermore, the Treasury Board of Canada Secretariat (TBS) is taking additional and immediate steps to enhance its oversight of departmental practices and processes and support effective management across government.
Today, TBS released an update to the Manager's Guide: Key Considerations When Procuring Professional Services and signaled its intent to embed certain elements of the Guide within TBS Mandatory Procedures to strengthen the accountability of managers.
Additionally, in the coming months, TBS will introduce a new Risk and Compliance Process, which will assess government-wide trends, risks and individual departmental performance in key management areas and take immediate corrective actions where necessary.
Lastly, to ensure that public servants maintain the trust of Canadians, TBS will review the Directive on Conflict of Interest to ensure that the requirements are clear and effective, particularly as they relate to employees who engage in outside employment, including contracts with the Government of Canada. TBS will also review guidance provided to deputy heads and explore additional oversight that will include strengthening the consequences of non-compliance with the Directive.
Going forward, PSPC and TBS will continue to accelerate the Government of Canada's procurement modernization efforts and introduce new initiatives to strengthen procurement and management practices.
The Government of Canada is unwavering in its stance against unethical and illegal business practices and for the prudent use of tax dollars. Instances of fraud and misconduct will be thoroughly investigated, and appropriate action will be taken to hold bad actors accountable.
"Unethical business practices have no place in the Government of Canada's business dealings. That is why we are taking concrete steps to strengthen procurement practices and implementing new measures to hold those who circumvent the rules accountable."
The Honourable Jean-Yves Duclos
Minister of Public Services and Procurement
"Canadians deserve to know how their hard-earned tax dollars are being spent, and that they are being spent wisely and responsibly. To foster public trust, public service leaders must ensure sound procurement and management practices across government. That is why we are stepping up our oversight of management practices, including strengthening compliance and accountability with mandatory policies across government."
The Honourable Anita Anand
President of the Treasury Board
- PSPC has a framework in place to prevent, detect and respond to potential wrongdoing, in order to safeguard the integrity of the federal procurement system. This approach includes a variety of tools to actively detect wrongdoing, and to respond to allegations that the Government of Canada is being defrauded either in a specific contract or on a broader scale.
- Investigations by PSPC found that 3 subcontractors for professional services undertook contract work across 36 Government of Canada departments and agencies. These individuals fraudulently billed the Government of Canada by an estimated $5 million by billing multiple organizations for the same period of time under multiple separate contracts.
- The new OSIC program will enhance the measures found in the current Integrity Regime and enable PSPC to respond to a broader array of wrongdoing in a manner proportionate to the actual risk posed by suppliers.
- PSPC is working with client departments to finalize a new master level user agreement for contracts for professional services. This agreement will stipulate the use of new contract provisions to increase costing and subcontractor transparency, and provide important clarifications on the role of technical authorities in ensuring consistent practices when using PSPC procurement instruments.
- In fall 2023, TBS published the new Manager's Guide: Key Considerations When Procuring Professional Services. The Guide is designed to help public service managers determine when to contract for professional services versus when to use internal resources. It also lays out practical considerations to structure contracts so they deliver the best possible value, can be effectively managed and fully align with requirements of the Directive on the Management of Procurement.
- The Office of the Chief Information Officer and the Office of the Comptroller General of Canada are working together to make improvements to the open data portal so information is presented more clearly and in more user-friendly formats. The first phase of the portal update went live on March 6 to clarify the number of contracts and total value for more than 75% of entries that previously presented unclear data. Departments will apply further clarifications and corrections over the coming weeks, and TBS will make other updates to the portal to improve the usability of the data posted by departments.
- Procurement Improvement Action Plan
- New measures to strengthen management and oversight of government procurement
- Combating Fraudulent Activities Announcement - Canada.ca
- Spring 2018 announcement of enhancements to the Integrity Regime: Canada to enhance its toolkit to address corporate wrongdoing
- Fall 2018 consultation: Administering Canada's enhanced Integrity Regime
- Procurement modernization and improving e-procurement
- Federal Contracting Fraud Tip Line
- Canada's Integrity Regime
- Manager's Guide: Key Considerations When Procuring Professional Services
- Directive on the Management of Procurement
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SOURCE Public Services and Procurement Canada
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